Descripción de la tecnología

Senate Resolution Number 122 asked us to determine whether or not CMS, in the course of the procurement process or resolution of the protests, took into consideration the cost impact the solicitation might place on the family members, friends, and general public who are

responsible for paying for the calls. To answer this determination, we examined the inmate collect calling invitation for bids and also talked to officials with both CMS and Corrections. We also compared the cost structure in Illinois to other states.

Invitation for Bids Wording/ Scoring Criteria

While the State considered the cost to the user in its evaluation criteria, the invitation for bids assigned a higher percentage of evaluation points to the amount of commission the State would receive from the vendors. The evaluation criteria in the invitation for bids consisted of two pricing components. One component, worth 55 percent of the points, was the commission percentage paid to the State. The other component, worth 45 percent of the points, was the cost of the service to the users. By comparison, in the previous solicitation in 2002, the request for proposals did not include the cost to the user as part of the evaluation. So from that perspective, the cost impact to the user was considered in the most recent invitation for bids. However, in the invitation for bids, the commission paid to the State was assigned more points which indicates that the revenue to the State was considered more important than the cost to the user.

Information from Correspondence/Interviews

Under the current contract with Securus Technologies (Securus) the distance of a call no longer factors into its cost. A Corrections official we spoke to indicated that the billing structure was changed at least in part because of complaints received from users about the complicated rate structure. The State wanted to limit additional fees since charges were the biggest complaint from constituents. Under the previous contract with Consolidated Communications

(Consolidated) the cost of a call varied depending on the distance. An example given was when inmates would move to a prison in another part of the State they would end up paying higher rates because their calls were no longer local. The same Corrections official had explained in an email to other officials at Corrections and CMS that a CMS Bureau of Computer and

Communications Services official had contacted the states of Indiana and Missouri and found that those states had gone with one rate for their inmate calls. In that email the rationale for the State of Illinois also going with one rate was so that “...all families pay the same rate regardless of where the inmate is being housed.”

The following example illustrates how the cost of a call under the prior contract would differ depending on the distance between the two parties. Under the prior contract with

Consolidated, InterLata/Intrastate (a call made outside the local calling area but within the state) call rates were based on mileage. The cost for a 15 minute call placed between two locations up to 10 miles apart was $5.35. The cost for a 15 minute call placed between two locations at least 293 miles apart was $6.40. The difference between the two rates for a 15 minute call ($6.40- $5.35) was $1.05. (See Exhibit 5-1 below.)

Exhibit 5-1

INTERLATA/INTRASTATE CALL RATES 2002 CONSOLIDATED CONTRACT

Mileage Per Minute Rate Surcharge

Calculated Cost (for 15 minute call)

1-10 $0.19 $2.50 $5.35 11-22 $0.20 $2.50 $5.50 23-55 $0.21 $2.50 $5.65 56-124 $0.23 $2.50 $5.95 125-292 $0.25 $2.50 $6.25 293-430 $0.26 $2.50 $6.40

Source: OAG analysis of the 2002 Consolidated contract.

Under the current contract with Securus all InterLata/Intrastate calls cost $3.55 (as of September 2013). This rate is comprised of a surcharge which is charged per call. There are no additional per minute charges.

The new contract with Securus resulted in lower costs to users compared to the previous contract with Consolidated. When comparing the months in which only

Consolidated or Securus operated the State’s inmate collect calling service (excluding transition months in which both vendors were operating inmate collect calling services), the data showed that the minutes per call increased while at the same time the cost per call decreased under the Securus contract. The average cost per call for all types of calls under Consolidated’s contract from August 2011, to December 2012, was $5.82. The average minutes per call for all types of calls were 16.8. The average cost per call for all types of calls under Securus’ contract from April 2013, to December 2013, was $3.87. The average minutes per call for all types of calls were 23.1.

Federal Communications Commission (FCC) Findings

In its ruling on rates for interstate inmate calling services which took effect on February 11, 2014, the FCC found that “...inmate phone rates today vary widely, and in far too many cases greatly exceed the reasonable costs of providing the service.” The ruling went on to state:

“A significant factor driving these excessive rates is the widespread use of site commission payments – fees paid by ICS [Inmate Calling Service] providers to

correctional facilities or departments of corrections in order to win the exclusive right to provide inmate phone service. These site commission payments, which are often taken directly from provider revenues, have caused inmates and their friends and families to subsidize everything from inmate welfare to salaries and benefits, states’ general revenue funds, and personnel training.”

The ruling cited the example of several states that have ended commission payments on their inmate calling services; those states have seen significant reductions in their costs per call. The FCC stated that commission payments are not costs that directly relate to the provision of

range of purposes, most of which have no direct relation to providing those services. If Illinois eliminated commission payments, it would have a positive cost impact on the family members, friends, and general public who are responsible for paying for the calls.

The FCC also found that rates charged to users are but one of many factors used to judge competing bids. Some selections are based largely on the amount of cash and/or in-kind

inducement offered rather than being driven by proposals focused on high quality service at the most affordable rates for consumers. The FCC ruling is discussed in more detail in a later section of this chapter.